February Gas-Price Spike Becoming an Annual Tradition?

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Demand for gasoline usually dips during the cold, sleepy month of February. Prices at the pump tend to decrease or remain flat as well. Not last February, though, when gas prices spiked during a run-up to peak prices in the spring. And this February, prices are rising even quicker than last year.

Twelve months ago, drivers were puzzled — and annoyed — by the sharp increase in gas prices, which was doubly frustrating because February has traditionally been a month when prices at the pump fall. Around mid-February 2012, the national average for a gallon was $3.52, which was 40¢ higher than it was at the same point in 2011. Drivers grumbled that they were paying the highest ever prices for such an early time of the year and that prices were rising roughly 1¢ per day in many states.

Lately, according to the AAA Fuel Gauge Report, the national average is $3.75 per gallon. Prices have risen every day for more than a month, in what seems to have become a new February tradition that’s unwelcomed by drivers.

(MORE: What Would Make an All-Electric Car Appeal to the Masses?)

While an early-year gas-price hike isn’t entirely shocking given the events of last year, the pace of the rise is especially swift. In Chicago, the average price rose 40¢ over the past month and is now close to $4.10 per gallon. During the same one-month span, prices increased 60¢ in Michigan, according to Detroit News. In California, prices crept up 55¢ over a 25-day span, hitting all-time highs for this time of year. The Orlando Sentinel reported that a gallon of gas in central Florida costs 16¢ more than it did just one week ago, and 41¢ more than three weeks ago.

The reaction of analysts is that these annual price increases should more or less be expected nowadays. Per the Orlando Sentinel:

‘So far, market trends and price fluctuations at the pump have been similar to 2011 and 2012, leading analysts to believe prices will peak in April before they retreat,’ said Jessica Brady, an Auto Club Group spokeswoman in Tampa.

“We see something like this happen around the end of January,” Mark Griffin, president of the Michigan Petroleum Association, told Detroit News. “[Prices] start up from there as speculators start counting on an increase in demand going into spring.”

(MORE: How High Do Gas Prices Have to Go to Change Driver Behavior?)

What this may mean is that, more often than not going forward, drivers should expect gas prices to rise — not fall — during the first few months of every year.

10 comments
banzaigtv
banzaigtv

Yup. This is the new standard: gas price spikes in February, peaking in April, falling through the summer and lowest in December.

DeweySayenoff
DeweySayenoff

People seem to think the government has any control over lowering the price of gas.  They don't.  They can only increase it (as Bush proved for us over the last ten years).  Once oil companies figured out that they can get away with this - no one burning down refineries, no one stalking and assassinating oil executives, people continuing to buy gas and demand that they drill more.

Well, they drill more today than they did with Bush in charge and the price is only going up.  It's not federal taxes.  It's the deliberate manipulation of the oil prices by making it available to be sold on the global market.  Once it CAN be sold at global prices, they can charge us as if it HAD BEEN, even though it hasn't.  This is why the United States is now a net oil EXPORTER.  We're not really selling any of that oil overseas.  They're just charging us for domestic oil pumped by American companies on U.S. soil and in U.S. held waters AS IF IT was bought at global prices.

Of course, every time there's a contrived shortage - someone trips over a power cord, or pays a homeless person to walk through the refinery smoking, or some other excuse or deliberate sabotage of the oil refining capacity - regardless of the actual demand, it's assumed that the supply on hand will be inadequate and the price will rise.  Toss in a lot of wink-wink, nudge-nudge foot dragging in getting refineries back online and you have a shortage that didn't have to be there.  Why?

Because we don't use the damn stuff they're making.  We use the stuff they already made.  And they CAN expand storage CAPACITY and run refineries over capacity to even out fluctuations in prices by storing more than they need.  The next year, they can top it off and add more if they think they need it.  Storage facilities don't cost nearly as much as refineries, but they deliberate keep supplies on had at a premium just so they can have these contrived shortages and drive up the futures market.

All you need to do is look at our gasoline storage capacity compared with our oil reserve capacity and relate them to the average and peak demands.  Look at where the oil goes before it's refined (that's how you can tell if they're charging global prices instead of domestic ones - if it got anywhere near a global exporting port, they can do it).  And when the Keystone pipeline is finished (after stage 3) they're just going to screw us over even more.

Yeah, drill, baby, drill isn't going to do anything other than make the oil execs richer and the rest of us poorer.  If you think the oil companies actually yield to supply and demand, then why is it that prices can shoot upward like a rocket, but it takes fifty times longer for it to come back down - long after supplies are more than adequate?  Check it out yourself.  It's a hell of an eye-opener.

ralphwiggummm
ralphwiggummm

Obamanomics at work here, perhaps?

DeweySayenoff
DeweySayenoff

@ralphwiggummm Only in the mind of the delusional.

ralphwiggummm
ralphwiggummm

@DeweySayenoff @ralphwiggummm Delusional, I be...didn't the campaigner in chief applaud $4 gas and make it sound like it was his administration's policy to give us high gas prices so we would drive less and support alternative fuels more? Or were those just bad dreams? I am putty in your hands, oh wise one!

tomsquawk
tomsquawk

yep, along with the summer spike

spck007
spck007

What I want to know is what are the gas companies puting back into the economy from all the profits they are benefiting due to the increase in prices. And you can not tell me they are just fluctuating with the oil prices. These companies are not hurting financially. If they are unwilling to decrease their prices they should show the public how they are contributing to our current economic standing.

pendragon05
pendragon05

" pace of the rice"

Someone did not proofread.

rob473
rob473

"the pace of the rice is especially swift" 

These silly typos are sad to see.